Operating results for the six months ended March 31, 2020 are not necessarily indicative of the results that can be expected for the year ending September 30, 2020.
Organization and Nature of Operations (note 1)
Subsequent Events (note 9)
(The accompanying notes are an integral part of these condensed consolidated financial statements)
4
AMERICAN BATTERY METALS CORPORATION
Condensed Consolidated Statements of Operations
(unaudited)
|
For the three months ended
March 31,
2020
$
|
For the three months ended
March 31,
2019
$
|
For the six months ended
March 31,
2020
$
|
For the six months ended
March 31,
2019
$
|
Revenues
|
-
|
-
|
-
|
-
|
|
|
|
|
|
Operating expenses
|
|
|
|
|
Exploration costs
|
229,335
|
5,460
|
240,646
|
25,080
|
General and administrative
|
1,786,600
|
6,450,636
|
2,858,420
|
7,593,232
|
|
|
|
|
|
Net loss from operations
|
(2,015,935)
|
(6,456,096)
|
(3,099,066)
|
(7,618,312)
|
|
|
|
|
|
Other income (expense)
|
|
|
|
|
|
|
|
|
|
Change in fair value of derivative liability
|
(3,558,652)
|
(235,853)
|
(3,623,387)
|
(944,008)
|
Interest expense
|
(2,503,804)
|
(439,474)
|
(4,435,612)
|
(717,164)
|
Gain on settlement of debt
|
565,405
|
568,218
|
693,268
|
146,473
|
Other income
|
-
|
-
|
3,746
|
-
|
|
|
|
|
|
Total other income (expense)
|
(5,497,051)
|
(107,109)
|
(7,361,985)
|
(1,514,699)
|
|
|
|
|
|
Net loss
|
(7,512,986)
|
(6,563,205)
|
(10,461,051)
|
(9,133,011)
|
Net loss per share, basic and diluted
|
(0.03)
|
(0.06)
|
(0.05)
|
(0.09)
|
Weighted average shares outstanding, basic and diluted
|
266,995,894
|
114,162,697
|
208,416,834
|
106,790,885
|
|
|
|
|
|
(The accompanying notes are an integral part of these condensed consolidated financial statements)
5
AMERICAN BATTERY METALS CORPORATION
Condensed Consolidated Statement of Stockholders’ Deficit
(unaudited)
|
Series A Preferred Shares
|
Common Shares
|
|
|
|
|
Number
|
Amount
$
|
Number
|
Amount
$
|
Additional
Paid-In
Capital
$
|
Accumulated
Deficit
$
|
Total
Stockholders’
Deficit
$
|
Balance, September 30, 2018
|
-
|
-
|
93,331,449
|
93,331
|
34,739,491
|
(37,265,334)
|
(2,432,512)
|
|
|
|
|
|
|
|
|
Shares issued for services
|
-
|
-
|
3,200,000
|
3,200
|
485,800
|
-
|
489,000
|
|
|
|
|
|
|
|
|
Shares issued for joint venture
|
-
|
-
|
250,000
|
250
|
35,000
|
-
|
35,250
|
|
|
|
|
|
|
|
|
Shares issued pursuant to
note conversion
|
-
|
-
|
5,753,660
|
5.754
|
867,078
|
-
|
872,832
|
|
|
|
|
|
|
|
|
Net loss for the period
|
-
|
-
|
-
|
-
|
-
|
(2,569,806)
|
(2,569,806)
|
|
|
|
|
|
|
|
|
Balance, December 31, 2018
|
-
|
-
|
102,535,109
|
102,535
|
36,127,369
|
(39,835,140)
|
(3,605,236)
|
|
|
|
|
|
|
|
|
Shares issued for services
|
-
|
-
|
19,550,000
|
19,550
|
5,819,810
|
-
|
5,839,360
|
|
|
|
|
|
|
|
|
Shares cancelled
|
-
|
-
|
(10,000,000)
|
(10,000)
|
10,000
|
-
|
-
|
|
|
|
|
|
|
|
|
Shares issued pursuant to
note conversion
|
-
|
-
|
2,242,983
|
2,243
|
539,177
|
-
|
541,420
|
|
|
|
|
|
|
|
|
Net loss for the period
|
-
|
-
|
-
|
-
|
-
|
(6,563,205)
|
(6,563,205)
|
|
|
|
|
|
|
|
|
Balance, March 31, 2019
|
-
|
-
|
114,328,092
|
114,328
|
42,496,356
|
(46,398,345)
|
(3,787,661)
|
(The accompanying notes are an integral part of these condensed consolidated financial statements)
6
AMERICAN BATTERY METALS CORPORATION
Condensed Consolidated Statement of Stockholders’ Deficit
(unaudited)
|
Series A Preferred Shares
|
Common Shares
|
|
|
|
|
|
Number
|
Amount
$
|
Number
|
Amount
$
|
Additional
Paid-In
Capital
$
|
Share
Subscriptions
$
|
Accumulated
Deficit
$
|
Total
Stockholders’
Deficit
$
|
|
|
|
|
|
|
|
|
|
Balance, September 30, 2019
|
-
|
-
|
132,678,133
|
132,678
|
44,970,398
|
-
|
(49,890,538)
|
(4,787,462)
|
|
|
|
|
|
|
|
|
|
Preferred shares issued
|
300,000
|
300
|
-
|
-
|
(300)
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Shares issued for services
|
-
|
-
|
5,560,000
|
5,560
|
227,960
|
-
|
-
|
233,520
|
|
|
|
|
|
|
|
|
|
Shares issued for conversion of
notes payable and accrued interest
|
-
|
-
|
29,554,757
|
29,555
|
1,143,889
|
-
|
-
|
1,173,444
|
|
|
|
|
|
|
|
|
|
Shares issued for warrant exercise
|
-
|
-
|
2,996,985
|
2,997
|
(2,997)
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Fair value of share purchase warrants
|
-
|
-
|
-
|
-
|
94,786
|
-
|
-
|
94,786
|
|
|
|
|
|
|
|
|
|
Share subscriptions received
|
-
|
-
|
-
|
-
|
-
|
275,000
|
-
|
275,000
|
|
|
|
|
|
|
|
|
|
Net loss for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
(2,948,065)
|
(2,948,065)
|
|
|
|
|
|
|
|
|
|
Balance, December 31, 2019
|
300,000
|
300
|
170,789,875
|
170,790
|
46,433,736
|
275,000
|
(52,838,603)
|
(5,958,777)
|
|
|
|
|
|
|
|
|
|
Shares issued for services
|
-
|
-
|
17,236,200
|
17,236
|
672,212
|
-
|
-
|
689,448
|
|
|
|
|
|
|
|
|
|
Shares issued for conversion of
notes payable and accrued interest
|
-
|
-
|
139,078,983
|
139,078
|
7,001,975
|
-
|
-
|
7,141,053
|
|
|
|
|
|
|
|
|
|
Shares issued for warrant exercise
|
-
|
-
|
1,313,822
|
1,314
|
(1,314)
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
Fair value of share purchase warrants
|
-
|
-
|
-
|
-
|
58,528
|
-
|
-
|
58,528
|
|
|
|
|
|
|
|
|
|
Share subscriptions received
|
-
|
-
|
-
|
-
|
-
|
850,000
|
-
|
850,000
|
|
|
|
|
|
|
|
|
|
Net loss for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
(7,512,986)
|
(7,512,986)
|
|
|
|
|
|
|
|
|
|
Balance, March 31, 2020
|
300,000
|
300
|
328,418,880
|
328,418
|
54,165,137
|
1,125,000
|
(60,351,589)
|
(4,732,734)
|
(The accompanying notes are an integral part of these condensed consolidated financial statements)
7
AMERICAN BATTERY METALS CORPORATION
Condensed Consolidated Statements of Cash Flows
(Unaudited)
|
For the
six months
ended
March 31,
2020
$
|
For the
six months
ended
March 31,
2019
$
|
Operating Activities
|
|
|
|
|
|
Net loss
|
(10,461,051)
|
(9,133,011)
|
|
|
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
Accretion expense
|
3,290,632
|
645,235
|
Change in fair value of derivative liabilities
|
3,623,387
|
944,008
|
Discount on convertible notes payable
|
937,287
|
67,754
|
Fair value of share purchase warrants issued
|
153,314
|
-
|
Gain on settlement of debt
|
(693,268)
|
(146,473)
|
Shares issued for services
|
922,968
|
6,328,360
|
|
|
|
Changes in operating assets and liabilities:
|
|
|
Prepaid expenses
|
(75,980)
|
115,705
|
Accounts payable and accrued liabilities
|
230,043
|
98,844
|
Due to related parties
|
104,180
|
113,094
|
|
|
|
Net Cash Used In Operating Activities
|
(1,968,488)
|
(966,484)
|
|
|
|
Financing Activities
|
|
|
Proceeds from issuance of convertible notes payable
|
1,973,750
|
1,944,000
|
Proceeds from private placement subscriptions
|
1,125,000
|
-
|
Repayment of convertible notes payable
|
(855,259)
|
(752,736)
|
|
|
|
Net Cash Provided By Financing Activities
|
2,243,491
|
1,191,264
|
|
|
|
Change in Cash
|
275,003
|
224,780
|
Cash – Beginning of Period
|
7,371
|
122,769
|
|
|
|
Cash – End of Period
|
282,374
|
347,549
|
|
|
|
Non-cash investing and financing activities:
|
|
|
Derivative additions associated with convertible notes
|
2,029,525
|
1,939,539
|
Original issuance discount on convertible debenture
|
113,300
|
99,750
|
Common shares issued for conversion of convertible notes payable
|
8,314,497
|
1,414,252
|
Common shares issued on the exercise of cashless warrants
|
4,311
|
-
|
Preferred shares issued to officers and directors
|
300
|
-
|
|
|
|
(The accompanying notes are an integral part of these condensed consolidated financial statements)
8
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
1. Organization and Nature of Operations
The accompanying unaudited consolidated financial statements of American Battery Metals Corporation (formerly Oroplata Resources, Inc.) have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or the SEC, including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all the information and notes necessary for comprehensive consolidated financial statements and should be read in conjunction with our audited consolidated financial statements for the year ended September 30, 2019, included in our Annual Report on Form 10-K for the year ended September 30, 2019.
The Company was incorporated under the laws of the state of Nevada on October 6, 2011 for the purpose of acquiring and developing mineral properties. The Company has a wholly-owned subsidiary called Oroplata Exploraciones E Ingenieria SRL, which was incorporated in the Dominican Republic on January 10, 2012. On July 26, 2016, the Company incorporated Lithortech Resources Inc., a Nevada company, as a wholly-owned subsidiary. The Company currently holds mineral rights in the Western Nevada Basin of Nye County in the state of Nevada.
Going Concern
The recent outbreak of the novel coronavirus COVID-19, which was declared a pandemic by the World Health Organization on March 11, 2020, has led to adverse impacts on the U.S. and global economies, disruptions of financial markets, and created uncertainty regarding potential impacts to the Company’s supply chain and operations. The COVID-19 pandemic has impacted and could further impact the Company’s operations and the operations of the Company’s suppliers and vendors as a result of quarantines, facility closures, and travel and logistics restrictions. The extent to which the COVID-19 pandemic impacts the Company’s business, results of operations and financial condition will depend on future developments, which are highly uncertain and cannot be predicted, including, but not limited to the duration, spread, severity, and impact of the COVID-19 pandemic, the effects of the COVID-19 pandemic on the Company’s suppliers and vendors and the remedial actions and stimulus measures adopted by local and federal governments, and to what extent normal economic and operating conditions can resume. The management team is closely following the progression of COVID-19 and its potential impact on the Company. Even after the COVID-19 pandemic has subsided, the Company may experience adverse impacts to its business as a result of any economic recession or depression that has occurred or may occur in the future. Therefore, the Company cannot reasonably estimate the impact at this time our business, liquidity, capital resources and financial results.
These unaudited consolidated financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As at March 31, 2020, the Company has not earned revenue, has a working capital deficit of $4,767,984, and an accumulated deficit of $60,351,589. The continuation of the Company as a going concern is dependent upon the continued financial support from its management, and its ability to identify future investment opportunities and obtain the necessary debt or equity financing, and generating profitable operations from the Company’s future operations. If the Company is able to obtain financing, there is no certainty that terms will be favorable to the Company. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These unaudited consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.
9
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
2. Summary of Significant Accounting Policies
(a)Basis of Presentation
The financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars. The Company’s fiscal year end is September 30.
(b)Principles of Consolidation
These condensed consolidated financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States and are expressed in U.S. dollars. These condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Oroplata Exploraciones E Ingenieria SRL, Lithortech Resources Inc., and ABMC AG, LLC. All inter-company accounts and transactions have been eliminated on consolidation.
3. Convertible Notes Payable
(a)On April 8, 2019, the Company issued a convertible note payable for $38,500 which is unsecured, bears interest at 10% per annum which increases to 24% per annum if the note is in default, and is due on January 8, 2020. The note is also convertible into common shares of the Company at 68% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 1,568,017 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $5,208), the unamortized discount on the note is $nil (September 30, 2019 - $33,292), accrued interest of $nil (September 30, 2019 - $1,839) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $31,405).
(b)On April 8, 2019, the Company issued a convertible note payable for $38,500 which is unsecured, bears interest at 10% per annum which increases to 24% per annum if the note is in default, and is due on January 8, 2020. The note is also convertible into common shares of the Company at 68% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 1,562,033 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $5,208), the unamortized discount on the note is $nil (September 30, 2019 - $33,292), accrued interest of $nil (September 30, 2019 - $1,839) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $31,405).
(c)On May 1, 2019, the Company issued a convertible note payable for $325,000 which is unsecured, bears interest at 10% per annum and is due on May 1, 2020. The note is also convertible into common shares of the Company at 68% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 20,886,476 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $22,805), the unamortized discount on the note is $nil (September 30, 2019 - $302,195), accrued interest of $nil (September 30, 2019 - $13,451) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $284,348).
(d)On May 1, 2019, the Company issued a convertible note payable for $325,000 which is unsecured, bears interest at 10% per annum and is due on May 1, 2020. The note is also convertible into common shares of the Company at 68% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 19,024,857 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $22,805), the unamortized discount on the note is $nil (September 30, 2019 - $302,195), accrued interest of $nil (September 30, 2019 - $13,451l) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $284,348).
10
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
3. Convertible Notes Payable (continued)
(e)On May 29, 2019, the Company issued a convertible note payable for $325,000 which is unsecured, bears interest at 10% per annum and is due on May 29, 2020. The note is also convertible into common shares of the Company at 68% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 17,116,458 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020,, the carrying value of the note payable is $nil (September 30, 2019 - $16,726), the unamortized discount on the note is $nil (September 30, 2019 - $308,274), accrued interest of $nil (September 30, 2019 - $10,924) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $289,004).
(f)On June 3, 2019, the Company issued a convertible note payable for $55,000 which is unsecured, bears interest at 12% per annum which increases to 22% per annum if the note is in default, and is due on March 30, 2020. The note is also convertible into common shares of the Company at 61% of the lowest trading price of the Company’s common share for the ten trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 2,903,221 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, 2019, the carrying value of the note payable is $nil (September 30, 2019 - $3,488), the unamortized discount on the note is $nil (September 30, 2019 - $51,512), accrued interest of $nil (September 30, 2019 - $2,145) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $56,840).
(g)On June 11, 2019, the Company issued a convertible note payable for $105,000 which is unsecured, bears interest at 10% per annum and is due on June 11, 2020. The note is also convertible into common shares of the Company at 68% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 7,021,366 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $35,868), the unamortized discount on the note is $nil (September 30, 2019 - $69,142), accrued interest of $nil (September 30, 2019 - $3,179) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $93,716).
(h)On June 12, 2019, the Company issued a convertible note payable for $55,000 which is unsecured, bears interest at 12% per annum which increases to 22% per annum if the note is in default, and is due on March 12, 2020. The note is also convertible into common shares of the Company at 68% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 3,646,544 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $3,075), the unamortized discount on the note is $nil (September 30, 2019 - $51,925), accrued interest of $nil (September 30, 2019 - $1,980) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $46.520).
(i)On June 12, 2019, the Company issued a convertible note payable for $55,000 which is unsecured, bears interest at 12% per annum which increases to 22% per annum if the note is in default, and is due on March 12, 2020. The note is also convertible into common shares of the Company at 68% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 3,540,668 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $3,075), the unamortized discount on the note is $nil (September 30, 2019 - $51,925), accrued interest of $nil (September 30, 2019 - $1,980) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $46,520).
(j)On June 13, 2019, the Company issued a convertible note payable for $75,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum which increases to 15% per annum if the note is in default, and is due on June 17, 2020. The note is also convertible into common shares of the Company at 65% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 6,421,298 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $2,862), the unamortized discount on the note is $nil (September 30, 2019 - $72,138), accrued interest of $nil (September 30, 2019 - $2,229) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $71,671).
11
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
3. Convertible Notes Payable (continued)
(k)On June 21, 2019, the Company issued a convertible note payable for $270,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on June 17, 2020. The note is also convertible into common shares of the Company at 68% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. On March 24, 2020, the Company issued 5,082,065 common shares for the settlement of note payable of $90,000 and accrued interest of $6,657.53. As at March 31, 2020, the carrying value of the note payable is $156,669 (September 30, 2019 - $56,011), the unamortized discount on the note is $23,331 (September 30, 2019 - $241,602), accrued interest of $20,825 (September 30, 2019 - $7,425) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $234,622 (September 30, 2019 - $239,317).
(l)On June 27, 2019, the Company issued a convertible note payable for $98,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on June 27, 2020. The note is also convertible into common shares of the Company at 66% of the lowest trading price of the Company’s common share for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 6,467,394 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $2.692), the unamortized discount on the note is $nil (September 30, 2019 - $95,308), accrued interest of $nil (September 30, 2019 - $2,532) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $91,469).
(m)On June 27, 2019, the Company issued a convertible note payable for $58,000. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on June 27, 2020. The note is also convertible into common shares of the Company at 61% of the lowest trading price of the Company’s common shares for the ten trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 3,659,524 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $1,798), the unamortized discount on the note is $nil (September 30, 2019 - $56,202), accrued interest of $nil (September 30, 2019 - $1,798) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $59,759).
(n)On July 9, 2019, the Company issued a convertible note payable for $160,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on July 9, 2020. The note is also convertible into common shares of the Company at 60% of the lowest closing bid price of the Company’s common shares for the fifteen trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 11,220,902 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $3,600), the unamortized discount on the note is $nil (September 30, 2019 - $156,400), accrued interest of $nil (September 30, 2019 - $3,600) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $169,527).
(o)On July 11, 2019, the Company issued a convertible note payable for $50,000. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on July 11, 2020. The note is also convertible into common shares of the Company at 60% of the lowest trading price of the Company’s common shares for the twenty trading days prior to the date of conversion. During the period ended March 31, 2020, the Company issued 2,688,172 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $1,317), the unamortized discount on the note is $nil (September 30, 2019 - $48,863), accrued interest of $nil (September 30, 2019 - $1,317) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $54,669).
(p)On July 29, 2019, the Company issued a convertible note payable for $53,000. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on June 15, 2020. The note is also convertible into common shares of the Company at 61% of the lowest trading price of the Company’s common shares for the ten trading days prior to the date of conversion. On January 28, 2020, the Company repaid the principal balance of $53,000 and accrued interest of $3,162. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $1,078), the unamortized discount on the note is $nil (September 30, 2019 - $51,922), accrued interest of $nil (September 30, 2019 - $1,078) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $55,136).
12
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
3. Convertible Notes Payable (continued)
(q)On August 1, 2019, the Company issued a convertible note payable for $175,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on August 1, 2020. The note is also convertible into common shares of the Company at 68% of the lowest closing bid price of the Company’s common shares for the twenty prior trading days prior to the date of conversion. On February 3, 2020, the Company partially repaid the note balance of $96,370 and accrued interest of $11,618. On February 6, 2020, the Company issued 5,026,425 common shares for the settlement of note payable of $78,630 and accrued interest of $4,375. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $34,136), the unamortized discount on the note is $nil (September 30, 2019 - $140,864), accrued interest of $nil (September 30, 2019 - $2,868) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $158,571).
(r)On August 8, 2019, the Company issued a convertible note payable for $105,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on August 8, 2020. The note is also convertible into common shares of the Company at 60% of the lowest trading price of the Company’s common shares for the prior fifteen trading days including the date of conversion. During the period ended March 31, 2020, the Company issued 6,151,284 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $1,517), the unamortized discount on the note is $nil (September 30, 2019 - $103,483), accrued interest of $nil (September 30, 2019 - $1,517) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $113,820).
(s)On August 12, 2019, the Company issued a convertible note payable for $105,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on August 12, 2020. The note is also convertible into common shares of the Company at 60% of the lowest trading price of the Company’s common shares for the prior fifteen trading days including the date of conversion. On February 7, 2020, the Company repaid the principal balance of $105,000 and accrued interest of $5,104. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $1,400), the unamortized discount on the note is $nil (September 30, 2019 - $103,600), accrued interest of $nil (September 30, 2019 - $1,400) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $113,725).
(t)On August 28, 2019, the Company issued a convertible note payable for $35,200. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on May 28, 2020. The note is also convertible into common shares of the Company at 62% of the lower of the lowest trading price of the Company’s common stock in the twenty trading days prior to the date of conversion and the lowest trading price of the Company’s common stock in the twenty days prior to the date of issuance. During the period ended March 31, 2020, the Company issued 2,049,666 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $375), the unamortized discount on the note is $nil (September 30, 2019 - $34,825), accrued interest of $nil (September 30, 2019 - $375) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $35,083).
(u)On August 28, 2019, the Company issued a convertible note payable for $35,200. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on May 28, 2020. The note is also convertible into common shares of the Company at 68% of the lower of the lowest trading price of the Company’s common stock in the twenty trading days prior to the date of conversion and the lowest trading price of the Company’s common stock in the twenty days prior to the date of issuance. During the period ended March 31, 2020, the Company issued 2,104,577 common shares for the settlement of the principal balance and accrued interest. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $5,869), the unamortized discount on the note is $nil (September 30, 2019 - $29,331), accrued interest of $nil (September 30, 2019 - $375) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $30,617).
13
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
3. Convertible Notes Payable (continued)
(v)On August 28, 2019, the Company issued a convertible note payable for $110,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on August 28, 2020. The note is also convertible into common shares of the Company at 60% of the lowest trading price of the Company’s common stock in the twenty trading days prior to the date of conversion. On February 21, 2020, the Company repaid the principal balance of $110,000 and accrued interest of $5,286. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $978), the unamortized discount on the note is $nil (September 30, 2019 - $109,022), accrued interest of $nil (September 30, 2019 - $978) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $121,624).
(w)On September 13, 2019, the Company issued a convertible note payable for $175,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on September 13, 2020, of which the proceeds were not received until October 2019. The note is also convertible into common shares of the Company at the lower of the closing common stock price and 68% of the lowest trading price in the prior twenty trading days including the date of conversion. As at March 31, 2020, the carrying value of the note payable is $20,124 (September 30, 2019 - $nil), the unamortized discount on the note is $154,876 (September 30, 2019 - $nil), accrued interest of $9,625 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $235,589 (September 30, 2019 - $nil).
(x)On September 17, 2019, the Company issued a convertible note payable for $150,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on January 17, 2021. The note is also convertible into common shares of the Company at the lower of the closing common stock price and 68% of the lowest trading price in the prior twenty trading days on which at least 100 common shares of the Company were traded including the date of conversion. On March 10, 2020, the Company repaid the principal balance of $150,000 and accrued interest of $7,208. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $92), the unamortized discount on the note is $nil (September 30, 2019 - $54,908), accrued interest of $nil (September 30, 2019 - $542) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $152,239).
(y)On September 24, 2019, the Company issued the second tranche of the convertible note payable dated June 13, 2019 for $55,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on September 24, 2020. The note is also convertible into common shares of the Company at the lower of the closing common stock price and 65% of the lowest trading price in the prior twenty trading days prior to the date of conversion. On March 20, 2020, the Company repaid the principal balance of $55,000 and accrued interest of $2,689. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $96), the unamortized discount on the note is $nil (September 30, 2019 - $54,908), accrued interest of $nil (September 30, 2019 - $96) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $59,287).
(z)On September 24, 2019, the Company issued a convertible note payable for $48,000. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on September 24, 2020. The note is also convertible into common shares of the Company at the lower of the closing common stock price and 61% of the lowest trading price in the prior twenty trading days prior to the date of conversion. On March 18, 2020, the Company repaid the principal balance of $48,000 and accrued interest of $2,784. As at March 31, 2020, the carrying value of the note payable is $nil (September 30, 2019 - $96), the unamortized discount on the note is $nil (September 30, 2019 - $47,904), accrued interest of $nil (September 30, 2019 - $96) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $nil (September 30, 2019 - $56,217).
(aa)On October 15, 2019, the Company issued a convertible note payable for $52,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on October 15, 2020. The note is also convertible into common shares of the Company at the lower of the closing common stock price and 66% of the lowest trading price in the prior twenty trading days including the date of conversion. As at March 31, 2020, the carrying value of the note payable is $4,386 (September 30, 2019 - $nil), the unamortized discount on the note is $47,614 (September 30, 2019 - $nil), accrued interest of $2,398 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $73,856 (September 30, 2019 - $nil).
14
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
3. Convertible Notes Payable (continued)
(bb)On October 15, 2019, the Company issued a convertible note payable for $29,150. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on October 15, 2020. The note is also convertible into common shares of the Company at 61% of the lower of the lowest trading price in the twenty days prior to the issuance date or 61% of the lowest trading price in the prior twenty trading days including the date of conversion. As at March 31, 2020, the carrying value of the note payable is $2,786 (September 30, 2019 - $nil), the unamortized discount on the note is $26,364 (September 30, 2019 - $nil), accrued interest of $1,573 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $46,291 (September 30, 2019 - $nil).
(cc)On October 15, 2019, the Company issued a convertible note payable for $29,150. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on October 15, 2020. The note is also convertible into common shares of the Company at 61% of the lower of the lowest trading price in the twenty days prior to the issuance date or 61% of the lowest trading price in the prior twenty trading days including the date of conversion. As at March 31, 2020, the carrying value of the note payable is $2,818 (September 30, 2019 - $nil), the unamortized discount on the note is $26,332 (September 30, 2019 - $nil), accrued interest of $1,613 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $46,352 (September 30, 2019 - $nil).
(dd)On October 31, 2019, the Company issued a convertible note payable for $43,000. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on October 31, 2020. The note is also convertible into common shares of the Company at 61% of the lower of the lowest trading price in the ten days prior to the date of conversion. As at March 31, 2020, the carrying value of the note payable is $3,496 (September 30, 2019 - $nil), the unamortized discount on the note is $39,504 (September 30, 2019 - $nil), accrued interest of $2,150 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $69,888 (September 30, 2019 - $nil).
(ee)On November 1, 2019, the Company issued a convertible note payable for $20,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on November 1, 2020. The note is also convertible into common shares of the Company at 65% of the lower of the lowest trading price or lowest closing bid of the Company’s common stock in the twenty trading days prior to notice of conversion. As at March 31, 2020, the carrying value of the note payable is $1,407 (September 30, 2019 - $nil), the unamortized discount on the note is $18,593 (September 30, 2019 - $nil), accrued interest of $833 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $29,785 (September 30, 2019 - $nil).
(ff)On November 4, 2019, the Company issued a convertible note payable for $113,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on November 4, 2020. The note is also convertible into common shares of the Company at 60% of the lowest trading price of the Company’s common stock in the fifteen trading days prior to notice of conversion. As at March 31, 2020, the carrying value of the note payable is $7,679 (September 30, 2019 - $nil), the unamortized discount on the note is $105,321 (September 30, 2019 - $nil), accrued interest of $4,614 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $185,787 (September 30, 2019 - $nil).
(gg)On November 4, 2019, the Company issued a convertible note payable for $46,200. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on November 4, 2020. The note is also convertible into common shares of the Company at 61% of the lower of the lowest trading price or lowest closing bid of the Company’s common stock in the twenty trading days prior to notice of conversion. As at December 31, 2019, the carrying value of the note payable is $2,455 (September 30, 2019 - $nil), the unamortized discount on the note is $43,745 (September 30, 2019 - $nil), accrued interest of $1,802 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $67,148 (September 30, 2019 - $nil).
(hh)On December 9, 2019, the Company issued a convertible note payable for $47,300. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on December 9, 2020. The note is also convertible into common shares of the Company at 61% of the lower of the lowest trading price or lowest closing bid of the Company’s common stock in the twenty trading days prior to notice of conversion. As at March 31, 2020, the carrying value of the note payable is $2,318 (September 30, 2019 - $nil), the unamortized discount on the note is $44,982 (September 30, 2019 - $nil), accrued interest of $1,766 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $78,036 (September 30, 2019 - $nil).
15
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
3. Convertible Notes Payable (continued)
(ii)On December 23, 2019, the Company issued a convertible note payable for $43,000. Under the terms of the note, the amount owing is unsecured, bears interest at 12% per annum and is due on December 23, 2020. The note is also convertible into common shares of the Company at 61% of the lowest trading price of the Company’s common stock in the ten trading days prior to notice of conversion. As at March 31, 2020, the carrying value of the note payable is $3,255 (September 30, 2019 - $nil), the unamortized discount on the note is $39,745 (September 30, 2019 - $nil), accrued interest of $1,405 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $69,549 (September 30, 2019 - $nil).
(jj)On January 31, 2020, the Company issued a convertible note payable for $147,250. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on January 31, 2021. The note is also convertible into common shares of the Company at 60% of the lowest trading price of the Company’s common stock in the prior twenty trading days including the date of conversion. As at March 31, 2020, the carrying value of the note payable is $2,454 (September 30, 2019 - $nil), the unamortized discount on the note is $144,796 (September 30, 2019 - $nil), accrued interest of $2,454 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $243,199 (September 30, 2019 - $nil).
(kk)On January 31, 2020, the Company issued a convertible note payable for $147,250. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on January 31, 2021. The note is also convertible into common shares of the Company at 40% of the lowest trading price of the Company’s common stock in the prior twenty trading days including the date of conversion. As at March 31, 2020, the carrying value of the note payable is $2,454 (September 30, 2019 - $nil), the unamortized discount on the note is $144,796 (September 30, 2019 - $nil), accrued interest of $2,454 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $384,774 (September 30, 2019 - $nil).
(ll)On February 7, 2020, the Company issued a convertible note payable for $177,200. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on February 7, 2021. The note is also convertible into common shares of the Company at 60% of the lowest trading price of the Company’s common stock in the prior twenty trading days including the date of conversion. As at March 31, 2020, the carrying value of the note payable is $2,658 (September 30, 2019 - $nil), the unamortized discount on the note is $174,542 (September 30, 2019 - $nil), accrued interest of $2,658 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $292,461 (September 30, 2019 - $nil).
(mm)On February 14, 2020, the Company issued a convertible note payable for $83,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on December 1, 2020. The note is also convertible into common shares of the Company at 61% of the lowest trading price of the Company’s common stock in the ten trading days prior to date of conversion. As at March 31, 2020, the carrying value of the note payable is $1,084 (September 30, 2019 - $nil), the unamortized discount on the note is $81,916 (September 30, 2019 - $nil), accrued interest of $1,084 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $133,650 (September 30, 2019 - $nil).
(nn)On February 14, 2020, the Company issued a convertible note payable for $75,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on February 14, 2021. The note is also convertible into common shares of the Company at 65% of the lower of lowest closing bid or lowest trading price of the Company’s common stock in the twenty trading days prior to date of conversion. As at March 31, 2020, the carrying value of the note payable is $979 (September 30, 2019 - $nil), the unamortized discount on the note is $74,021 (September 30, 2019 - $nil), accrued interest of $979 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $112,662 (September 30, 2019 - $nil).
16
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
3. Convertible Notes Payable (continued)
(oo)On February 18, 2020, the Company issued a convertible note payable for $110,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on February 18, 2021. The note is also convertible into common shares of the Company at the lesser of (i) 61% multiplied by the lowest trading price during the previous twenty trading days before the "Issue Date" of the note or (ii) 61% multiplied by the market price ( the lowest trading price for the common stock during the twenty trading-day period ending on the last complete trading day prior to the conversion date). As at March 31, 2020, the carrying value of the note payable is $1,314 (September 30, 2019 - $nil), the unamortized discount on the note is $108,686 (September 30, 2019 - $nil), accrued interest of $1,314 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $176,090 (September 30, 2019 - $nil).
(pp)On February 18, 2020, the Company issued a convertible note payable for $110,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on February 18, 2021. The note is also convertible into common shares of the Company at the lesser of (i) 61% multiplied by the lowest trading price during the previous twenty trading days before the "Issue Date" of the note or (ii) 61% multiplied by the market price ( the lowest trading price for the common stock during the twenty trading-day period ending on the last complete trading day prior to the conversion date). As at March 31, 2020, the carrying value of the note payable is $1,314 (September 30, 2019 - $nil), the unamortized discount on the note is $108,686 (September 30, 2019 - $nil), accrued interest of $1,314 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $176,090 (September 30, 2019 - $nil).
(qq)On February 19, 2020, the Company issued a convertible note payable for $220,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on February 19, 2021. The note is also convertible into common shares of the Company at 60% of the lowest closing bid price of the Company’s share for the fifteen trading days prior to date of conversion. As at March 31, 2020, the carrying value of the note payable is $2,567 (September 30, 2019 - $nil), the unamortized discount on the note is $217,433 (September 30, 2019 - $nil), accrued interest of $2,567 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $359,524 (September 30, 2019 - $nil).
(rr)On March 17, 2020, the Company issued a convertible note payable for $520,000. Under the terms of the note, the amount owing is unsecured, bears interest at 10% per annum and is due on September 17, 2020. The note is also convertible into common shares of the Company at 63% of the lowest closing trading price of the Company’s share in the prior twenty trading days including date of conversion. As at March 31, 2020, the carrying value of the note payable is $2,022 (September 30, 2019 - $nil), the unamortized discount on the note is $517,978 (September 30, 2019 - $nil), accrued interest of $2,022 (September 30, 2019 - $nil) has been recorded in accounts payable and accrued liabilities, and had a derivative liability of $760,941 (September 30, 2019 - $nil).
4. Related Party Transactions
(a)As of March 31, 2020, the Company owes $120,146 (September 30, 2019 - $120,146) to the former Chief Executive Officer and Director of the Company for advances to the Company to fund day-to-day operations. The amounts owing are unsecured, non-interest bearing, and due on demand.
(b)As of March 31, 2020, the Company owes $85,500 (September 30, 2019 - $85,500) to the former Chief Executive Officer and Director of the Company for advances to the Company to fund day-to-day operations and accrued management fees. The amounts owing are unsecured, non-interest bearing, and due on demand.
(c)As of March 31, 2020, the Company owes $326,077 (September 30, 2019 - $221,897) to the Chief Executive Officer of the Company for accrued management fees. The amounts owing are unsecured, non-interest bearing, and due on demand.
(d)As of March 31, 2020, the Company owes $30,726 (September 30, 2019 – $30,726) to directors of the Company for accrued management fees. The amounts owing are unsecured, non-interest bearing, and due on demand.
17
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
5. Investment in Joint Venture
On October 8, 2018, the Company entered into a joint venture agreement with CINC Industries Inc. (“CINC”), a Nevada company, for a period of five years whereby the joint venture will propagate the sale of a new process for extraction of lithium salt from salt brine solutions using CINC’s existing and future processing equipment. As part of the joint venture, each of CINC and the Company holds a 50% interest in the joint venture. CINC is responsible for completing testing on the pilot project, providing training to the Company for use of its processing equipment, manufacturing up to 20 test units, and support and product development, as well as shared costs on other personnel utilized in the joint venture company. The Company is responsible for the initial funding for all equipment and associated expenses, the cost of the lease space, and marketing and sales of the joint venture agreement. The joint venture is committed to acquiring a minimum amount of processing equipment, goods, accessories, and/or materials totalling: (i) $1,000,000 by October 8, 2020; (ii) $3,000,000 by October 8, 2021; (iii) $6,000,000 by October 8, 2022; and (v) $10,000,000 by October 8, 2023. In the event that the joint venture fails to meet the minimum amounts above, the Company will lose the exclusive right to market, promote and sell the processing equipment provided by CINC. As part of the joint venture agreement, the Company issued 250,000 common shares to CINC. Refer to Note 7(b).
6. Derivative Liabilities
The Company records the fair value of the conversion price of the convertible debentures as disclosed in Note 4 in accordance with ASC 815, Derivatives and Hedging. The fair value of the derivatives was calculated using a multi-nominal lattice model. The fair value of the derivative liabilities is revalued on each balance sheet date with corresponding gains and losses recorded in the consolidated statement of operations. For the six months ended March 31, 2020, the Company recorded a loss on the change in the fair value of derivative liability of $3,623,387 (2019 - $944,008). As at March 31, 2020, the Company recorded a derivative liability of $3,776,294 (September 30, 2019 - $$3,437,200).
The following inputs and assumptions were used to value the derivative liabilities outstanding during the periods ended March 31, 2020 and September 30, 2019:
|
March 31,
2020
|
September 30,
2019
|
Expected volatility
|
70-319%
|
75-151%
|
Risk free rate
|
1.41%
|
1.75%
|
Expected life (in years)
|
0.2-1.0
|
0.2-1.0
|
A summary of the activity of the derivative liability is shown below:
|
$
|
Balance, September 30, 2019
|
3,437,200
|
Derivative additions associated with convertible notes
|
2,029,525
|
Adjustment for conversion/repayment
|
(5,313,818)
|
Mark to market adjustment at March 31, 2020
|
3,623,387
|
|
|
Balance, March 31, 2020
|
3,776,294
|
7. Common Shares
The Company’s authorized common stock consists of 1,200,000,000 shares of common stock, with par value of $0.001, and authorized Series A preferred stock of 500,000 shares of preferred stock, with par value of $0.001.
On October 1, 2019, the Company issued 300,000 Series A preferred stock to officers and directors of the Company for no consideration. The preferred stock has no conversion rights, not entitled to receive dividends, carries voting rights of 1,000 votes per share of preferred stock, and is redeemable at the option of the Company at par value of $0.001 per share.
On October 3, 2019, the Company issued 917,777 common shares with a fair value of $49,560 for the conversion of $30,000 of notes payable, $2,225 of accrued interest, and $23,675 of derivative liability resulting in a gain on settlement of debt of $6,340.
18
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
7. Common Shares (Continued)
On October 8, 2019, the Company issued 577,496 common shares with a fair value of $31,185 for the conversion of $15,000 of notes payable, $500 of fees, and $17,800 of derivative liability resulting in a gain on settlement of debt of $2,115.
On October 10, 2019, the Company issued 2,036,114 common shares with a fair value of $97,733 for the conversion of $55,000 of notes payable, $4,129 of accrued interest, and $47,710 of derivative liability resulting in a gain on settlement of debt of $9,106.
On October 15, 2019, the Company issued 465,723 common shares with a fair value of $29,341 for the conversion of $12,000 of notes payable, $500 of fees, and $18,440 of derivative liability resulting in a gain on settlement of debt of $1,599.
On October 17, 2019, the Company issued 502,980 common shares with a fair value of $25,149 for the conversion of $13,000 of notes payable, $500 of fees, and $13,747 of derivative liability resulting in a gain on settlement of debt of $2,098.
On October 18, 2019, the Company issued 1,113,981 common shares with a fair value of $54,028 for the conversion of $30,000 of notes payable, $2,350 of accrued interest, and $27,088 of derivative liability resulting in a gain on settlement of debt of $5,410.
On October 21, 2019, the Company issued 542,526 common shares with a fair value of $29,242 for the conversion of $12,000 of notes payable, $500 of fees, $2,061 of accrued interest, and $16,874 of derivative liability resulting in a gain on settlement of debt of $2,193.
On October 25, 2019, the Company issued 559,768 common shares with a fair value of $27,429 for the conversion of $14,500 of notes payable, $500 of fees, $24 of accrued interest, and $15,781 of derivative liability resulting in a gain on settlement of debt of $3,376.
On October 25, 2019, the Company issued 481,557 common shares with a fair value of $23,596 for the conversion of $10,500 of notes payable, $500 of fees, $1,925 of accrued interest and $13,570 of derivative liability resulting in a gain on settlement of debt of $2,899.
On October 28, 2019, the Company issued 2,996,985 common shares for the exercise of cashless warrants.
On October 30, 2019, the Company issued 744,949 common shares with a fair value of $36,503 for the conversion of $20,000 of notes payable, $1,633 of accrued interest, and $19,841 of derivative liability resulting in a gain on settlement of debt of $4,972.
On October 31, 2019, the Company issued 500,000 common shares with a fair value of $24,500 for the conversion of $9,500 of notes payable, $500 of fees, and $16,152 of derivative liability resulting in a gain on settlement of debt of $1,652.
On November 4, 2019, the Company issued 820,497 common shares with a fair value of $33,640 for the conversion of $20,000 of notes payable, $1,661 of accrued interest and derivative liability of $17,362 resulting in a gain on settlement of debt of $5,383.
On November 8, 2019, the Company issued 815,396 common shares with a fair value of $35.877 for the conversion of $6,234 of notes payable, $1,645 of accrued interest, $13,647 of finance penalties, and $19,231 of derivative liability resulting in a gain on settlement of debt of $4,880.
On November 8, 2019, the Company issued 5,560,000 common shares with a fair value of $233,520 for consulting services including 1,000,000 common shares with a fair value of $42,000 to a director of the Company.
On November 12, 2019, the Company issued 972,587 common shares with a fair value of $39,876 for the conversion of $25,000 of notes payable, $1,653 of accrued interest, and $20,360 of derivative liability resulting in a gain on settlement of debt of $7,137.
On November 20, 2019, the Company issued 994,354 common shares with a fair value of $35,797 for the conversion of $20,000 of notes payable, $1,367 of accrued interest, and $19,506 of derivative liability resulting in a gain on settlement of debt of $5,076.
On November 20, 2019, the Company issued 1,986,954 common shares with a fair value of $71,531 for the conversion of $40,000 of notes payable, $2,696 of accrued interest, and $37,954 of derivative liability resulting in a gain on settlement of debt of $9,119.
19
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
7. Common Shares (Continued)
On November 21, 2019, the Company issued 850,000 common shares with a fair value of $34,000 for the conversion of $11,825 of notes payable, $500 of fees, and $23,375 of derivative liability resulting in a gain on settlement of debt of $1,700.
On November 29, 2019, the Company issued 996,680 common shares with a fair value of $37,874 for the conversion of $20,000 of notes payable, $1,417 of accrued interest, and $21,476 of derivative liability resulting in a gain on settlement of debt of $5,018.
On December 6, 2019, the Company issued 607,477 common shares with a fair value of $20,958 for the conversion of $13,000 of notes payable and $11,339 of derivative liability resulting in a gain on settlement of debt of $3,381.
On December 9, 2019, the Company issued 746,269 common shares with a fair value of $25,224 for the conversion of $15,000 of notes payable and $14,028 of derivative liability resulting in a gain on settlement of debt of $3,804.
On December 10, 2019, the Company issued 999,524 common shares with a fair value of $32,984 for the conversion of $20,000 of notes payable, $1,478 of accrued interest, and $16,607 of derivative liability resulting in a gain on settlement of debt of $5,101.
On December 11, 2019, the Company issued 845,771 common shares with a fair value of $25,458 for the conversion of $17,000 of notes payable and $13,874 of derivative liability resulting in a gain on settlement of debt of $5,416.
On December 12, 2019, the Company issued 700,000 common shares with a fair value of $22,820 for the conversion of $9,650 of notes payable, $500 of fees, and $14,396 of derivative liability resulting in a gain on settlement of debt of $1,726.
On December 13, 2019, the Company issued 703,704 common shares with a fair value of $22,167 for the conversion of $10,000 of notes payable, $3,300 of accrued interest, and $12,107 of derivative liability resulting in a gain on settlement of debt of $3,240.
On December 13, 2019, the Company issued 822,281 common shares with a fair value of $25,902 for the conversion of $15,000 of notes payable, $500 of fees, and $12,103 of derivative liability resulting in a gain on settlement of debt of $1,701.
On December 16, 2019, the Company issued 2,079,180 common shares with a fair value of $62,375 for the conversion of $40,000 of notes payable, $2,981 of accrued interest, and $33,668 of derivative liability resulting in a gain on settlement of debt of $14,274.
On December 16, 2019, the Company issued 567,874 common shares with a fair value of $17,036 for the conversion of $7,000 of notes payable, $500 of fees, $2,872 of accrued interest, and $7,416 of derivative liability resulting in a gain on settlement of debt of $752.
On December 17, 2019, the Company issued 1,047,754 common shares with a fair value of $35,624 for the conversion of $20,000 of notes payable, $1,517 of accrued interest, and $16,552 of derivative liability resulting in a gain on settlement of debt of $2,444.
On December 24, 2019, the Company issued 932,920 common shares with a fair value of $38,670 for the conversion of $6,650 of notes payable, $500 of fees, and $29,558 of derivative liability resulting in a loss of settlement of debt of $1,962.
On December 24, 2019, the Company issued 1,561,157 common shares with a fair value of $64,710 for the conversion of $25,000 of notes payable, $1,646 of accrued interest, and $43,120 of derivative liability resulting in a gain on settlement of debt of $5,056.
On December 27, 2019, the Company issued 896,925 common shares with a fair value of $30,047 for the conversion of $14,000 of notes payable, $500 of fees, $133 of accrued interest, and $16,948 of derivative liability resulting in a gain on settlement of debt of $1,535.
On December 30, 2019, the Company issued 1,164,572 common shares with a fair value of $32,608 for the conversion of $18,500 of notes payable, $500 of fees, and $14,929 of derivative liability resulting in a gain on settlement of debt of $1,321.
On January 2, 2020, the Company issued 2,316,826 common shares with a fair value of $81,090 for the conversion of $40,000 of note payable, $3,167 of accrued interest, and $49,831 of derivative liability resulting in a gain on settlement of debt of $11,908.
20
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
7. Common Shares (Continued)
On January 2, 2020, the Company issued 1,567,942 common shares with a fair value of $54,878 for the conversion of $25,000 of note payable, $1,708 of accrued interest, and $36,380 of derivative liability resulting in a gain on settlement of $8,210.
On January 2, 2020, the Company issued 892,857 common shares with a fair value of $31,250 for the conversion of $15,000 of note payable and $19,062 of derivative liability resulting in a gain on settlement of $2,812.
On January 3, 2020, the Company issued 1,553,815 common shares with a fair value of $49,722 for the conversion of $21,500 of note payable, $3,530 of accrued interest, $500 of fees, and $26,692 of derivative liability resulting in a gain on settlement of $2,500.
On January 3, 2020, the Company issued 2,000,000 common shares with a fair value of $64,000 for the conversion of $25,933 of note payable, $6,697 of accrued interest and $36,589 of derivative liability resulting in a gain on settlement of $5,219.
On January 3, 2020, the Company issued 892,857 common shares with a fair value of $28,572 for the conversion of $15,000 of note payable and $16,833 of derivative liability resulting in a gain on settlement of $3,261.
On January 6, 2020, the Company issued 860,000 common shares with a fair value of $25,800 for the conversion of $11,311 of note payable, $750 fees and $15,573 of derivative liability resulting in a gain on settlement of $1,834.
On January 6, 2020, the Company issued 1,264,782 common shares with a fair value of $37,944 for the conversion of $20,000 of note payable, $94 of accrued interest, $500 of fees and $19,661 of derivative liability resulting in a gain on settlement of $2,311.
On January 6, 2020, the Company issued 1,071,429 common shares with a fair value of $32,143 for the conversion of $18,000 of note payable and $17,815 of derivative liability resulting in a gain on settlement of $3,672.
On January 7, 2020, the Company issued 802,381 common shares with a fair value of $24,874 for the conversion of $10,000 of note payable, $3,622 of accrued interest and $14,098 of derivative liability resulting in a gain on settlement of $2,846.
On January 7, 2020, the Company issued 1,569,981 common shares with a fair value of $48,669 for the conversion of $25,000 of note payable, $1,743 of accrued interest and $27,445 of derivative liability resulting in a gain on settlement of $5,519.
On January 10, 2020, the Company issued 1,395,332 common shares for a fair value of $35,581 for the conversion of $20,000 of note payable, $1,014 of accrued interest and $21,671 of derivative liability resulting in a gain on settlement of $7,104.
On January 13, 2020, the Company issued 1,938,768 common shares for a fair value $52,347 for the conversion of $30,000 of note payable, $2,142 of accrued interest and $26,911 of derivative liability resulting in a gain on settlement of $6,706.
On January 14, 2020, the Company issued 1,340,000 common shares for a fair value of $45,560 for the conversion of $17,306 of note payable, $750 of fees and $31,041 of derivative liability resulting in a gain on settlement of $3,537.
On January 14, 2020, the Company issued 916,963 common shares for a fair value of $31,177 for the conversion of $14,000 of note payable, $600 of accrued interest, $500 of fees and $19,647 of derivative liability resulting in a gain on settlement of $3,570.
On January 14, 2020, the Company issued 5,021,366 common shares for a fair value of $170,726 for the conversion of $79,067 of note payable, $572 accrued interest and $114,349 of derivative liability resulting in a gain on settlement of $23,262.
On January 15, 2020, the Company issued 1,500,000 common shares for a fair value of $100,470 for the conversion of $19,462 of note payable, $750 of fees and $100,470 of derivative liability resulting in a gain on settlement of 21,212.
On January 15, 2020, the Company issued 4,649,492 common shares for a fair value of $311,422 for the conversion of $75,000 of note payable, $5,938 of accrued interest and $247,423 derivative liability resulting in a gain on settlement of $16,939.
On January 15, 2020, the Company issued 2,805,479 common shares for a fair value of $187,911 for the conversion of $40,000 of note payable, $2,082 of accrued interest and $154,571 of derivative liability resulting in a gain on settlement of $8,742.
21
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
7. Common Shares (Continued)
On January 15, 2020, the Company issued 3,232,955 common shares for a fair value of $216,543 for the conversion of $50,000 of note payable, $3,597 of accrued interest and $168,041 of derivative liability resulting in a gain on settlement of $5,095.
On January 16, 2020, the Company issued 3,233,793 common shares for a fair value of $181,093 for the conversion of $50,000, accrued interest of $3,611 and derivative liability of $132,763 resulting in a gain on settlement of $5,281.
On January 17, 2020, the Company issued 5,263,014 common shares for a fair value of $302,623 for the conversion of $75,000 of note payable, $3,945 of accrued interest and $242,111 of derivative liability resulting in a gain on settlement of $18,433.
On January 22, 2020, the Company issued 2,591,056 common shares for a fair value of $82,914 for the conversion of $40,000 of note payable, $2,956 accrued interest and $53,413 of derivative liability resulting in a gain on settlement of $13,455.
On January 23, 2020, the Company issued 1,757,077 common shares for a fair value of $70,248 for the conversion of $25,000 of note payable, $1,295 accrued interest and $52,557 of derivative liability resulting in a gain of settlement of $8,604.
On January 23, 2020, the Company issued 3,761,200 common shares with a fair value of $150,448 for consulting services.
On January 23, 2020, the Company issued 3,475,000 common shares with a fair value of $139,000 for consulting services including 1,000,000 common shares with a fair value of $40,000 to a director of the Company.
On January 27, 2020, the Company issued 4,679,001 common shares with a fair value of $170,784 for the conversion of $75,000 of note payable, $6,793 of accrued interest and $150,648 of derivative liability resulting in a gain on settlement of $61,657.
On January 27, 2020, the Company issued 2,594,407 common shares with a fair value of $94,695 for the conversion of $40,000 of note payable, $3,011 of accrued liability and $59,353 of derivative liability resulting in a gain on settlement of $7,669.
On January 30, 2020, the Company issued 2,596,417 common shares with a fair value of $84,383 for the conversion of $40,000, $2,683 of accrued interest and $50,666 of derivative liability resulting in a gain on settlement of 8,966.
On February 4, 2020, the Company issued 6,467,394 common shares with a fair value of $239,293 for the conversion of $98,000 of note payable, $5,907 of accrued interest, $105 of fees and $166,151 of derivative liability resulting in a gain on settlement of $30,870.
On February 5, 2020, the Company issued 2,503,957 common shares with a fair value of $113,930 for the conversion of $40,000 of note payable, $3,589 of accrued interest and $72,495 of derivative liability resulting in a gain on settlement of $2,154.
On February 5, 2020, the Company issued 670,000 common shares with a fair value of $30,485 for the conversion of $8,278 of note payable, $750 of fees and $22,106 of derivative liability resulting in a gain on settlement of $649.
On February 6, 2020, the Company issued 5,026,425 common shares with a fair value of $201,057 for the conversion of $78,630 of note payable, $4,375 of accrued interest and $134,206 of derivative liability resulting in a gain on settlement of $16,154.
On February 10, 2020, the Company issued 9,723,549 common shares with a fair value of $495,901 for the conversion of $150,000 of note payable, $11,096 of accrued interest, $105 of fees and $366,278 of derivative liability resulting in a gain on settlement of $31,578.
On February 10, 2020, the Company issued 1,118,568 common shares with a fair value of $57,047 for the conversion of $20,000 of note payable and $37,087 of derivative liability resulting in a gain on settlement of $40.
On February 10, 2020, the Company issued 7,834,840 common shares with a fair value of $399,577 for the conversion of $125,000 of note payable, $14,524 of accrued interest and $269,904 of derivative liability resulting in a gain on settlement of $9,851.
22
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
7. Common Shares (Continued)
On February 11, 2020, the Company issued 2,051,298 common shares with a fair value of $137,355 for the conversion of $18,641 of note payable, $4,564 of accrued interest, $1,500 of fees and $108,919 of derivative liability resulting in a gain on settlement of $3,731.
On February 12, 2020, the Company issued 1,388,889 common shares with a fair value of $83,333 for the conversion of $25,000 of note payable and $65,150 of derivative liability resulting in a gain on settlement of $6,817.
On February 14, 2020, the Company issued 2,688,172 common shares with a fair value of $161,290 for the conversion of $50,000 of note payable, $3,550 of accrued interest and $127,306 of derivative liability resulting in a gain on settlement of $19,566.
On February 19, 2020, the Company issued 9,301,308 common shares with a fair value of $836,188 for the conversion of $175,000 of note payable, $14,529 of accrued interest, $105 of fees and $238,239 of derivative liability resulting in a loss on settlement on $408,315.
On February 19, 2020, the Company issued 3,643,827 common shares with a fair value of $327,580 for the conversion of $60,000 of note payable, $5,472 of accrued interest and $327,580 of derivative liability resulting in a gain on settlement of $65,472.
On February 24, 2020, the Company issued 10,000,000 common shares with a fair value of $400,000 for consulting services including 6,000,000 common shares with a fair value of $240,000 to three directors of the Company.
On February 24, 2020, the Company issued 9,206,396 common shares with a fair value of $535,996 for the conversion of $175,000 of note payable, $12,705 of accrued interest, $105 of fees and $398,306 of derivative liability resulting in a gain on settlement of $50,120.
On February 27, 2020, the Company issued 1,313,822 common shares for the exercise of cashless warrants.
On March 1, 2020, the Company issued 2,104,577 common shares with a fair value of $99,967 for the conversion of $35,200 of note payable, $2,147 of accrued interest, $500 fees and $68,868 of derivative liability resulting in a gain on settlement of 6,748.
On March 2, 2020, the Company issued 2,049,666 common shares with a fair value of $97,359 for the conversion of $35,200 of note payable, $2,159 of accrued interest, $500 of fees and $69,374 of derivative liability resulting in a gain on settlement of $9,874.
On March 4, 2020, the Company issued 7,910,062 common shares with a fair value of $514,154 for the conversion of $150,000 of note payable, $11,635 of accrued interest, $105 of fees and $390,342 of derivative liability resulting in a gain on settlement of $37,928.
On March 24, 2020, the Company issued 5,082,065 common shares with a fair value of $193,118 for the conversion of $90,000 of note payable. $6,657 of accrued interest, $105 of fees and $127,986 of derivative liability resulting in a gain on settlement of $31,630.
During the period ended March 31, 2020, the Company received share subscriptions of $1,125,000 for the future issuance of private placement units at $0.04 per unit, where each unit is comprised of one common share of the Company and 0.8 share purchase warrant where each whole share purchase warrant can be exercised into one common share of the Company at $0.15 per share until October 31, 2024. As at the date of the filing, the private placement units have not been issued.
23
AMERICAN BATTERY METALS CORPORATION
Notes to the Condensed Consolidated Financial Statements
For the period ended March 31, 2020
(unaudited)
8. Share Purchase Warrants
|
Number of
warrants
|
Weighted
average
exercise price
$
|
|
|
|
Balance, September 30, 2019
|
8,925,334
|
0.10
|
Granted
|
2,722,224
|
0.17
|
Exercised
|
(4,310,807)
|
0.07
|
|
|
|
Balance, March 31, 2020
|
7,336,751
|
0.14
|
Additional information regarding share purchase warrants as of March 31, 2020, is as follows:
|
Outstanding and exercisable
|
Range of
Exercise Prices
$
|
Number of
Warrants
|
Remaining
Contractual Life
(years)
|
0.001
|
19,512
|
0.01
|
0.01
|
603,015
|
0.28
|
0.10
|
3,250,000
|
1.4
|
0.15
|
1,500,000
|
0.7
|
0.17
|
500,000
|
0.3
|
0.18
|
722,224
|
0.3
|
0.20
|
500,000
|
0.3
|
0.50
|
242,000
|
0.05
|
|
|
|
|
7,336,751
|
3.34
|
9. Subsequent Events
(a) In April 2020, the Company received $400,000 of share subscriptions for the future issuance of private placement units at $0.04 per unit, where each unit is comprised of one common share of the Company and 0.8 share purchase warrant where each whole share purchase warrant can be exercised into one common share of the Company at $0.15 per share until October 31, 2024
(b) Between April 1, 2020 and May 11, 2020, the Company issued 17,918,056 common shares for the conversion of outstanding convertible notes payable.
The Company has evaluated events occurring from March 31, 2020 through the date the financial statements were issued and determined that there are no additional events requiring disclosure
24